Can CENVAT paid or Input Tax paid on goods purchased be excluded for the purpose of valuation of inventory adhering to the principle "taxes that are subsequently reimbursed" ?
Can CENVAT paid or Input Tax paid on goods purchased be excluded for the purpose of valuation of inventory adhering to the principle "taxes that are subsequently reimbursed" ?
Cenvat or Input tax paid on goods purchased has to be included for Valuation of Inventory...............
Dear Jinshu Surendran,
When Excise Duty paid Input is used to manufacture goods on which Excise Duty is payable, Excise duty credit (CENVAT) can be availed. Hence, in such case excise duty on Purchases should not included in Valuation of Inventory to avoid cascading tax effect.
Thanks to all,
but I'll go with Shilpa's answer.....Excise Duty and Input Tax paid on goods can be considered as taxes that are subsequently reimbursed under AS 2
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